ACES System Development Pte Ltd v Yenty Lily (trading as Access International Services) [2013] SGCA 53

The Singapore Court of Appeal has set out the approach to be taken in assessing damage for detinue (the wrongful detention of goods or personal possessions) in ACES System Development Pte Ltd v Yenty Lily (trading as Access International Services).

Facts

The appellant (“ACES”) hired the respondent (“Yenty”) to provide, erect and dismantle mobile platforms at various locations on the site of ACES’ project. The contract provided that ACES was to financially assist Yenty to purchase the platforms, and Yenty was to repay the purchase price and the charges incurred by ACES in 12 monthly instalments. Yenty duly performed her obligations, and thereafter informed ACES in July 2009 that she was unable to carry out further works on the site as ACES had failed to pay her various amounts. ACES terminated the contract, and ACES only returned the platforms to Yenty in October 2010.

Legal proceedings

Yenty commenced legal proceedings for the wrongful retention of the platforms. The High Court found in favour of Yenty, and ordered an assessment of damages by an Assistant Registrar (“AR”). The AR awarded Yenty, inter alia, nominal damages of S$100 in respect of her claim for loss of use on the basis that Yenty had failed to prove any actual loss. Yenty appealed to the High Court who overturned the AR’s decision. The High Court applied the user principle (i.e. a person who has wrongfully used another’s property can be liable to pay, as damages, a reasonable sum for such use) and awarded Yenty S$189,000, being the rental that she could have earned from the platforms from February to October 2010.

ACES sought to reinstate the AR’s decision and appealed.

Court of Appeal decision

The Court of Appeal dismissed the appeal, although the Court of Appeal disagreed with the High Court’s reasoning in respect of the user principle. Instead, the Court of Appeal held that there was sufficient evidence for the court to come to the same conclusion by relying on the more general compensation principle, without reference to the user principle.

Compensation principle

The Court of Appeal reiterated that the compensation principle is a general principle which prescribes that when a tortious wrong is committed by the defendant, the plaintiff ought to be put in the same position, as far as it is possible, as if the tort had not been committed. On this basis, the Court of Appeal found that there was sufficient evidence of loss which would have allowed the awarding of substantive damages based on the compensation principle, without turning to the user principle. In this regard, the Court of Appeal considered that Yenty had intended to utilise the platforms in the context of her business, and that ACES had deprived her of the use of the platforms for the purposes of her business. Further, while Yenty was under an obligation to mitigate her loss, she would only have been required to take reasonable steps and that was done.

User principle

The user principle is different from (and, depending on the precise fact situation, may even be an exception to) the compensation principle. Without arriving at a conclusive or definitive view as to what the law ought to be, the Court of Appeal observed that one possible view of the user principle is that it is premised on a restitutionary basis. On such a basis, the damages awarded where there has been wrongful detention of the plaintiff’s goods by the defendant (as was the situation in the present appeal) ought to be measured by reference to the benefit which has accrued to the defendant (viz. the market hire of the goods), and the lack of actual use as such would not suffice to negate the existence of such a benefit. The user principle can be invoked by the plaintiff in this manner where it could not otherwise prove its loss pursuant to the compensation principle.

Judgment

There was sufficient evidence of Yenty’s loss in this case to establish an award of damages on both the general compensation principle and the user principle. Yenty should be awarded substantive damages because ACES had deprived her of the use of the platforms for the purpose of her business. ACES was therefore obliged to compensate her for the loss. The computation of damages was based on the reasonable market hire of the platforms during the period of detention.